To be a chartered financial analyst (CFA) is to possess one of the highest business qualifications available. Awarded by CFA Institute, it is internationally recognised as a gold standard by financial institutions and corporations.
Most CFA charterholders (as those who complete CFA Program are known) will go into the financial sector at an investment firm – either managing investments as a portfolio or fund manager, or as a research analyst. According to CFA Institute, about half of the world’s portfolio managers are CFA charterholders. But if you’re looking to apply your credentials in a newly developing sector or seeking a mid-career switch, there are some less obvious roles where the knowledge and skills of a CFA charterholder would prove invaluable. Here are five lesser-known career paths CFA charterholders can take.
Crypto sleuth
The labyrinthine world of cryptocurrencies is wide open to abuse – as the recent collapse of crypto trading company FTX demonstrated. The combination of blockchain technology, cryptography and digital finance can make the sector particularly hard to navigate.
The CFA Program equips charterholders with the type of forensic skills needed to follow digital breadcrumbs or paper trails. This is particularly useful when trying to establish misappropriation and other wrongdoings.
CFA charterholders also find their way into investigating other types of financial crime. It was a charterholder, Harry M Markopolos, who uncovered US financier Bernie Madoff’s infamous Ponzi scheme – a financial swindle in which early investors are repaid with money acquired from later investors rather than from actual investment income. Likewise, many charterholders work in regulation at public bodies such as the Securities and Exchange Commission in the US or the Financial Conduct Authority in the UK. Approximately 11,000 charterholders currently work in regulation. “Ethics is at the core of the CFA [qualification] at all three levels,” says Rob Langrick, general manager, CFA Program at CFA Institute. “In fact, many of our exam questions concern compliance issues.”
Carbon cutter
Understanding a business’s carbon emissions, particularly those that emanate from its suppliers (known as scope 3 emissions) is a complex business, but it’s also fundamental for the global shift to a zero carbon economy. As regulation and disclosure requirements expand, and carbon measurements become more precise, the ability to audit and benchmark companies against their peers is a vital skill – particularly in the financial sector, given the rapid rise of so-called ESG investment funds, which explicitly take into account environmental, social and governance factors.
Carbon analysts are responsible for tracking carbon emissions, assessments, analysis, and reporting in companies or public sector bodies.
CFA Institute has put climate change at the core of the CFA Program and its impact has been a key part of its syllabus for several years. Last year, CFA Institute launched a Climate Finance course in partnership with ACCA (the Association of Chartered Certified Accountants) to provide investment professionals with a better understanding of the economic and environmental impacts related to the climate crisis, as well as climate solutions.
Quant geek
Financial markets are growing in complexity all the time, fuelling demand for people who can understand the automated trading systems that drive them. Quantitative traders, or “quants”, use mathematical and statistical models to identify trading opportunities and buy and sell securities. Investopedia refers to them as the “rocket scientists of Wall Street” because the work is highly intellectual, abstract and pressurised. Due to the opportunities in this specialism, data scientists who are often highly computer literate but unfamiliar with the financial services industry are now enrolling in the CFA Program. CFA Institute has also created a Data Science Certificate to expand finance professionals’ knowledge on the use of AI and machine learning in the investment process.
Fintech entrepreneur
Digital transformation is disrupting finance, creating new services and products. Two notable fintech companies, PocketSuite and Grow were both founded by CFA charterholders, Samuel Madden and Kevin Sandhu. The CFA Program curriculum includes an understanding of digital applications such as machine learning, algorithmic trading and data science, ensuring charterholders are capable of entering fintech with confidence. “Entrepreneurs in this space have typically earned their CFA charter and then go on to fintech,” says Langrick. “They’re well equipped to succeed in this space given the fact that they know who they’re selling to and why they’re buying it.”
Behavioural guru
Behavioural finance is the study of the effects of psychology on investors and financial markets, with the aim of explaining why people often make irrational decisions either with their own money or other people’s. It’s increasingly used by the leading investment firms to understand common pitfalls in areas such as adviser and client relationships, portfolio construction and board groupthink. The CFA Program curriculum includes an understanding of behavioural biases, which means charterholders are well placed to meet the demand for expert behavioural finance analysts and advisers. “It’s now a hot topic but we’ve been thought leaders in that space for some time now,” says Langrick. “It’s important to understand the typical mind traps that people fall into or how to avoid errors like loss aversion, sunk costs and so on.”
The CFA Program provides expertise and real-world skills in investment analysis, preparing candidates for successful careers as investment professionals. If you’re interested in a career in finance visit cfainstitute.org/en/programs to find out more.